The telecoms boom and bust, 1996-2002: Puzzles, paradoxes, and processing

M Fransman

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

Why did investors believe that the Telecoms Industry would provide significantly above-average returns? In this chapter possible answers to this key question are explored through the examination of three hypotheses: the Biased Incentive Hypothesis, the Information Processing/Bounded Rationality Hypothesis, and the Guru Hypothesis of Information Selection. It is shown that although elements of all three hypotheses are to be found in the processes that led to the Telecoms Boom, these hypotheses, taken individually OF collectively, fail to provide a sufficient explanation for the boom. It is concluded that in order to explain the Telecoms Boom we need to know more about how investors constructed the interpretive frameworks that shaped their understanding of how the Telecoms Industry worked and what would happen to it in the future. The discussion is then linked to Keynesian and Austrian theories of the business cycle. In the penultimate section suggestions are made for further research, drawing on some of the ideas associated with Thomas Kuhn's concept of paradigms.

Original languageEnglish
Title of host publicationGLOBAL ECONOMY AND DIGITAL SOCIETY
EditorsE Bohlin, SL Levin, N Sung, CH Yoon
Place of PublicationAMSTERDAM
PublisherElsevier B.V.
Pages17-35
Number of pages19
ISBN (Print)0-444-51335-3
Publication statusPublished - 2004
Event14th Biennial Conference of the International-Telecommunications-Society - SEOUL
Duration: 18 Aug 200222 Aug 2002

Conference

Conference14th Biennial Conference of the International-Telecommunications-Society
CitySEOUL
Period18/08/0222/08/02

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